Armed troops took by force a luxury hotel in Manila today in an attempt to recapture two dozen rebel soldiers who had taken hostage journalists and some guests.

The front entrance of the Peninsula Hotel in Makati, Manila's business and financial district, was forced by dozens specialist police officers.

The hotel had been taken over by rebel troops asking the resignation of President Gloria Macapagal Arroyo. The rebels stormed out of a courthouse were they were trialed for an attempted coup in 2003 against Arroyo.

Explosions were heard at the side of the hotel and afterwards machine guns echoed around the building.

Live transmissions from the hotel showed people running with their faces covered by handkerchiefs.

At 5 p.m. (9 a.m. GMT) the operation to retake the building began. According to some unconfirmed reports, two people were injured during this operation, Guardian Unlimited reports.

Philippines Sen. Antonio Trillanes, one of the leaders of the rebel troops, announced that they will surrender so there will be no further injured.

Trillanes said: "I am here to fulfill my duty. But we have all seen what lengths the Arroyo administration is prepared to do to stay in power. But in the interests of the safety of people here, we are going to surrender.”

Earlier he declared to the media: "One thing I can assure you is we have more than enough willpower, fighting spirit to bring this government down. We want change."

The officers barricaded themselves in the hotel after fleeing the courthouse. Uniformed troops with M-16 rifles guarded the first floor of the hotel.

A deadline was given to them by police to surrender until 3 p.m. (7 a.m. GMT), but the officers refused to leave the hotel.

According to a witness, almost 200 people, including journalists, staff and guests, were prevented from leaving the building.

At 4.45 p.m. (8.45 a.m. GMT) six explosions were heard at the side of the hotel.

The rebels set a website were they’ve said that the country is facing "a crisis of extreme proportions" and the "economy, the rule of law and the moral order lie in ruins".

Brig. Gen Danilo Lim joined the rebels. He is suspected to have been involved in a failed coup plot last year. Lim issued a statement in which he pressured Arroyo to resign and asked the army to stop supporting her.

He read his statement on TV calling for a new government.

"Mrs. Arroyo stole the presidency from [Joseph] Estrada, and later manipulated the results of 2004 elections," he said.

Arroyo took power in 2001 when Estrada was ousted in a revolt.

Philippine Defense Secretary Gilberto said: “The situation is contained within the Peninsula hotel. The perpetrators are in the process of being arrested."

The rebels were seen being loaded into a Philippine National Police bus.